The following is a list of activities that companies perform in relation to their receivables.

1. Selling receivables to a factor.

2. Reviewing company ratings in The Dun and Bradstreet Reference Book of American Business.

3. Collecting information on competitors’ payment period policies 4. Preparing accounts receivable aging schedule and calculating the credit risk ratio.

5. Calculating the receivables turnover ratio and average collection period.

Instructions Match each of the activites listed above with a purpose of the activity listed below.

(a) Determine to whom to extend credit.

(b) Establish a payment period. «

(c) Monitor collections.

(d) Evaluate the receivables balance.

(e) Accelerate cash receipts from receivables when necessary.